Sunday, May 07, 2017
Negotiated Rates: What No One Talks About in Health Care Legislation
Last week, the House of Representatives passed legislation for the American Health Care Act, the first step in repealing the Affordable Care Act, or as some would call it, Trumpcare versus Obamacare. The American Psychiatric Association and the American Medical Association (and many other medical societies) oppose the new legislation. An enormous concern is that the new legislation won't require insurance companies to cover preexisting conditions, or require coverage for mental health treatment or prenatal/maternity care. Over the coming years, the new legislation is predicted to leave 24 million more Americans without health insurance coverage.
There are many criticisms of the ACA, one being that it forces people to pay for care for illnesses that they don't have and many will never get. I'm not sure why no one talks about policies where people can opt out of having coverage for cancer. Cancer is a very expensive disease, and not everyone gets it. If you believe you're at low risk, why should you have to foot the bill for someone's lung cancer any more than you should have to foot the bill for your neighbor's episode of depression?
Sarcasm aside, I wanted to talk about something that I don't see discussed anywhere. One huge and accurate criticism of the ACA is that premiums are high and deductibles are high. I'm not a fan, and it leaves people angry that they pay so much for health insurance and get so little out of it. But there is something missing in this discussion: if a person has health insurance and they see a doctor, have a procedure, have a lab test done, or get a scan, then the cost to the patient is the cost that has been negotiated by the the health insurance company, and it's remarkably lower than the cost to that a person with no health insurance. The craziness of our current health care system is that the people who can most afford to pay for their care are the ones who pay the least. So the high deductible may mean that a person pays for his own care, and only sees the benefit of being insured if there is a catastrophic illness, but it also means that while paying for that high-deductible care, out-of-pocket care non-catastrophic costs much less than the uninsured person pays. It's a crazy system where the poor subsidize the rich -- if a hospital will much lower fees from an insured person, why not accept those same lower fees from someone who doesn't have insurance? Does requiring people to purchase health insurance even out in the end? Not for those who are healthy: it leaves the "well" subsidizing the "sick," which in my opinion is better than the "poor" subsidizing the "rich."
No answers here. I don't believe that health insurance should be allowed to exclude those with pre-existing conditions: it dissuades people from getting care for fear of acquiring this label, and it provides a service that only the healthy or financially comfortable can afford. It's not even clear to me what defines a pre-existing condition: 23% of women in their 40's take an SSRI, do they all have a preexisting condition? If you told your doctor you were struggling with stress during a difficult time and she jotted "anxiety" on as a diagnosis once, does that mean you have a condition?
For catastrophic conditions, the taxpayer ends up with the bill anyway: before the ACA, if your car crashed or you were diagnosed with cancer or you ended up in the ER in a psychotic state, you were treated. Then you went bankrupt and got Medicaid; this didn't help anyone. If we can pick and choose, like playing Russian roulette with our health, well, I might not want to pay for your prostate cancer treatments any more than you wanted to pay for my maternity benefits, and I've never smoked, so I may be willing to role the dice on not getting lung cancer. Insurance is about diversifying risk. Mental health, addiction, and maternity services need to be part of the deal and you shouldn't get to pick and choose what health conditions you think you might get.
We need a mechanism beyond employer-based health insurance to care for those who are self-employed or who work at part-time or contractual jobs; we shouldn't have a situation again where someone in a family must work for an institution large enough to provide health benefits. Our young people today are not all poised to go straight from college to a job with health insurance; continuing family coverage until age 26 for this mostly health group of young people makes sense. For those in higher income brackets, it may make sense to charge more for family coverage for each adult child over age 21, but I've not seen that option mentioned anywhere. Finally, and perhaps most importantly, Trumpcare decreases funding to Medicaid: it denies the poorest among us health insurance, and as Mr. Trump might tweet: BAD! I can't see a way that leaving those who can least afford care uncovered would be cost-effective.
In all fairness, the administrative hassles of the ACA have not been good: they've diverted doctor time away from patient care and we have physician shortages. But perhaps the answer is to fix the troubled legislation that we have, not to start over. Personally, I think we should look to other countries and see if we can figure out what we're doing wrong: the US has the highest health care costs, and our results don't support this, we have the 46th longest life-span. Not so good for the greatest country on earth.
Posted by Dinah on Sunday, May 07, 2017